About Sh.

Dhirubhai Ambani



Few men in history have made as dramatic a contribution to their countrys economic fortunes as did
the founder of Reliance, Sh. Dhirubhai H Ambani. Fewer still have left behind a legacy that is more
enduring and timeless.
As with all great pioneers, there is more than one unique way of describing the true genius of
Dhirubhai: The corporate visionary, the unmatched strategist, the proud patriot, the leader of men, the
architect of Indias capital markets, the champion of shareholder interest.
But the role Dhirubhai cherished most was perhaps that of Indias greatest wealth creator. In one
lifetime, he built, starting from the proverbial scratch, Indias largest private sector enterprise.
When Dhirubhai embarked on his first business venture, he had a seed capital of barely US$ 300
(around Rs 14,000). Over the next three and a half decades, he converted this fledgling enterprise
into a Rs 60,000 crore colossusan achievement which earned Reliance a place on the global
Fortune 500 list, the first ever Indian private company to do so.
Dhirubhai is widely regarded as the father of Indias capital markets. In 1977, when Reliance Textile
Industries Limited first went public, the Indian stock market was a place patronised by a small club of
elite investors which dabbled in a handful of stocks.
Chairman's Profile


Anil D. Ambani



Regarded as one of the foremost corporate leaders of contemporary India, Anil Dhirubhai Ambani is
the Chairman of all the listed Group companies Reliance Communications, Reliance Capital,
Reliance Energy and Reliance Natural Resources Ltd.
Till recently, he also held the post of Vice Chairman and Managing Director of Reliance Industries
Limited (RIL), Indias largest private sector enterprise.
Anil D Ambani joined Reliance in 1983 as Co-Chief Executive Officer, and was centrally involved in
every aspect of the companys management over the next 22 years.
He is credited with having pioneered a number of path-breaking financial innovations in the Indian
capital markets. He spearheaded the countrys first forays into the overseas capital markets with
international public offerings of global depositary receipts, convertibles and bonds. Starting in 1991,
he directed Reliance Industries in its efforts to raise over US$ 2 billion. He also steered the 100-year
Yankee bond issue for the company in J anuary 1997.


He is a member of:
Wharton Board of Overseers, The Wharton School, USA
Central Advisory Committee, Central Electricity Regulatory Commission
Board of Governors, Indian Institute of Management, Ahmedabad
Board of Governors Indian Institute of Technology, Kanpur
In J une 2004, he was elected for a six-year term as an independent member of the Rajya Sabha,
Upper House of Indias Parliament a position he chose to resign voluntarily on March 25, 2006.
Awards and Achievements:
Conferred the CEO of the Year 2004 in the Platts Global Energy Awards
Rated as one of Indias Most Admired CEOs for the sixth consecutive year in the Business
Barons TNS Mode opinion poll, 2004
Conferred The Entrepreneur of the Decade Award by the Bombay Management Association,
October 2002
Awarded the First Wharton Indian Alumni Award by the Wharton India Economic Forum
(WIEF) in recognition of his contribution to the establishment of Reliance as a global leader in
many of its business areas, December 2001
Selected by Asiaweek magazine for its list of Leaders of the Millennium in Business and
Finance and was introduced as the only new hero in Business and Finance from India, J une
1999
B USI NESS PROFI L E

Reliance Communications Limited (the "Telecommunication Resulting Company") was originally
incorporated on J uly 15, 2004, under the Companies Act, 1956 as Reliance Infrastructure Developers
Private Limited. The status of the Company changed from private limited to public limited on J uly 25,
2005. Further the name of the Company changed to Reliance Communication Ventures Ltd with effect
from August 3, 2005. The name has since been changed to its present name, viz. Reliance
Communications Limited, under Fresh Certificate of Incorporation consequent on change of name
dated J une 7, 2006. .

In terms of the Scheme of Arrangement ("Scheme") with Reliance Industries Limited, as sanctioned
by the Hon'ble High Court of J udicature at Bombay by its Order dated December 9, 2005 and which
has became effective from December 21, 2005 the Company is vested with the Telecommunication
Undertaking of Reliance Industries Limited as defined in the Scheme.
OVERVIEW
A dream come true

The Late Dhirubhai Ambani dreamt of a digital India an India where the common man would have
access to affordable means of information and communication. Dhirubhai, who single-handedly built
Indias largest private sector company virtually from scratch, had stated as early as 1999: Make the
tools of information and communication available to people at an affordable cost. They will overcome
the handicaps of illiteracy and lack of mobility.
It was with this belief in mind that Reliance Communications (formerly Reliance Infocomm) started
laying 60,000 route kilometres of a pan-India fibre optic backbone. This backbone was commissioned
on 28 December 2002, the auspicious occasion of Dhirubhais 70th birthday, though sadly after his
unexpected demise on 6 J uly 2002.


Reliance Communications has a reliable, high-capacity, integrated (both wireless and wireline) and
convergent (voice, data and video) digital network. It is capable of delivering a range of services
spanning the entire infocomm (information and communication) value chain, including infrastructure
and services for enterprises as well as individuals, applications, and consulting.
Today, Reliance Communications is revolutionising the way India communicates and networks, truly
bringing about a new way of life.
Undaunted, Dhirubhai managed to convince a large number of first-time retail investors to participate
in the unfolding Reliance story and put their hard-earned money in the Reliance Textile IPO,
promising them, in exchange for their trust, substantial return on their investments. It was to be the
start of one of great stories of mutual respect and reciprocal gain in the Indian markets.
Under Dhirubhais extraordinary vision and leadership, Reliance scripted one of the greatest growth
stories in corporate history anywhere in the world, and went on to become Indias largest private
sector enterprise.
Through out this amazing journey, Dhirubhai always kept the interests of the ordinary shareholder
uppermost in mind, in the process making millionaires out of many of the initial investors in the
Reliance stock, and creating one of the worlds largest shareholder families.
We will leverage our strengths to execute complex global-scale projects to facilitate leading-edge
information and communication services affordable to all individual consumers and businesses in
India.
We will offer unparalleled value to create customer delight and enhance business productivity.
We will also generate value for our capabilities beyond Indian borders and enable millions of India's
knowledge workers to deliver their services globally.




BUSINESS
India s leading integrated telecom company
Reliance Communications is the flagship company of the Anil Dhirubhai Ambani Group (ADAG) of
companies. Listed on the National Stock Exchange and the Bombay Stock Exchange, it is Indias
leading integrated telecommunication company with over 25 million customers.
Our business encompasses a complete range of telecom services covering mobile and fixed line
telephony. It includes broadband, national and international long distance services and data services
along with an exhaustive range of value-added services and applications. Our constant endeavour is
to achieve customer delight by enhancing the productivity of the enterprises and individuals we serve.
Reliance Mobile (formerly Reliance India Mobile), launched on 28 December 2002, coinciding with the
joyous occasion of the late Dhirubhai Ambanis 70th birthday, was among the initial initiatives of
Reliance Communications. It marked the auspicious beginning of Dhirubhais dream of ushering in a
digital revolution in India. Today, we can proudly claim that we were instrumental in harnessing the
true power of information and communication, by bestowing it in the hands of the common man at
affordable rates.
We endeavour to further extend our efforts beyond the traditional value chain by developing and
deploying complete telecom solutions for the entire spectrum of society.





RELIANCE PRODUCT & SERVICES
Wireless wonderland
Reliance Mobile
With over 19 million subscribers, Reliance Mobile is Indias largest mobile service brand. It achieved
this distinction on 1 May 2003, within a mere seven months of its launch. Reliance Mobile services
now cover over 4,500 cities and towns across India. Our target is to soon cover 5,700 cities and
towns.
We have achieved many milestones in this short journey. In 2003, AC Nielsen voted Reliance Mobile
(formerly Reliance India Mobile) as India s Most Trusted Telecom Brand. In J uly 2003, it created a
world record by adding one million subscribers in a matter of just 10 days through its Monsoon
Hungama offer. What sets Reliance Mobile apart is the fact that nearly 90 per cent of our handsets
are data-enabled, and can access hundreds of J ava applications on Reliance Mobile World.
Reliance Mobile has ushered in a mobile revolution by offering advanced multimedia handsets to the
common man at very affordable rates. This innovative low pricing has increased the number of mobile
phone users and its result is clearly reflected in the meteoric rise in Indias tele-density over the past
four years.
Our pan-India wireless network runs on CDMA2000 1x technology, which has superior voice and data
capabilities compared to other cellular mobile technologies. CDMA200 1x is more cost-effective as it
utilises the scarce radio spectrum more efficiently than other technologies do. Enhanced voice clarity,
superior data speed of up to 144 kbps and seamless migration to newer generations of mobile
technologies are some of the differentiators that set CDMA200 1x technology apart from its
competitors.
















RELIANCE LANDLINE

Your landline phone no longer the same again!
High-end features, attractive tariff plans












Reliance Landline Features

A complimentary bouquet of features
Next-Gen Caller ID: Reliance Landline displays the name and/or number of a waiting caller
while you are in the middle of a conversation. It allows you the flexibility to choose between
two calls or switch from one caller to another.

Mobile phone features: Now enjoy all the interactive benefits of a mobile phone. Store and
recall numbers from the phone book, check the history of missed / dialed / received calls.
Whats more, you can also use the history menu to make fresh calls.

Delayed hotline: You can program your Reliance Landline to automatically call a predefined
number by lifting the receiver and holding it for seven seconds.

Navigation keys: Using the navigation keys on Reliance Landline you can activate phone
features like delayed hotline, line locking, etc now you need not remember complicated
feature codes and cumbersome procedures. You can also set your preferred ring tone, ringer
volume and LCD contrast.

Remote phone management: You can lock or unlock the STD/ ISD facility or hotline settings
on your Reliance Landline , remotely from anywhere, from any tone / DTMF phone.


An exciting future at Reliance Communications

Our service is based on a very simple principle: provide the world's best customer experience.
This we achieve through a winning combination of global competencies, pioneering technology and
state-of-the-art customer-centric systems and processes.
Our mission of changing lives across India meant that we needed to have a nationwide presence
something we achieved in a relatively short span of time. Our dream of helping people create, transfer
and apply knowledge challenged us to bring together contemporary communication technology from
across the world.


Now our operations are spread across 673 cities and span a host of various kinds of services. Our
business is organised around the following categories: wireless, wireline, wholesale, the webworld
and village telephony. The work is executed through different work centres like Engineering, Internet
data centres, Billing and Collection centres, Systems and Application centres in ERP, CRM, OSS
billing, revenue assurance and functions like Commercial, Finance, HR and IT. We manage this
integrated diversity by leading with trust. What differentiates us and fuels our growth is leadership.
The following attributes define future leadership at Reliance Communications:
Customer centricity.
Initiative and an attitude of ownership.
Passion for excellence and an ability to energise.
Problem solving and an innovative "can do" mindset.
Entrepreneurship and stretch.
Today Reliance Communications offers challenging assignments and career opportunities to
engineers, MBAs, Telecom network and IT specialists, profit centre heads as well as young
professionals.
Please post us with your resume so that as and when we find a fitting opportunity, we will contact you.
We invite you to join us in creating an exciting future and in building a career in a global service
company involved in an unique mission of changing and improving lives.


Postpaid & Prepaid

Your Postpaid & Prepaid Advantage
Friends and family special rates for calls made to mobile numbers of your friends and
family.
Intra-circle on-net pack unlimited calls to Reliance phones within your circle at a nominal
additional monthly rental.
Benefit of intra-circle rates Apply to calls within certain circle / state groups.
Special Reliance Mobile calling rates A 50 per cent discount on calls to Reliance mobiles
anywhere in the country.















Reliance Mobile World
The Reliance Mobile World suite of Reliance Mobile is a unique J ava-based application. Its
uniqueness lies in the fact that it enables complex Internet application to be introduced in mobile
phones effectively and quickly. Reliance Mobile World receives over 1.5 billion page views per month
from Reliance Mobile users.
Reliance Mobile World offers a wide array of applications that include hourly news updates, high
quality headline video clips, downloadable multi-lingual ring tones, seasonal updates including festival
specials, city and TV specials, exam results, astrology, mobile banking, bill payment, stock
information, commodity prices, railway and air ticket booking.

With over 150 data applications offering varied services unique to any wireless service in India
Reliance Mobile World is truly a treasure house of knowledge, information, entertainment and
commerce.
Reliance Netconnect
Leveraging our pan-India high speed CDMA2000 1x wireless network, Reliance Communications
offers the countrys foremost wireless Internet connectivity through R Connect nationwide. Reliance
Netconnect is Indias fastest growing Internet connectivity service which touched a user base of over
350,000 subscribers in less than seven months since its launch.
The highlight of the offering is that subscribers can connect to Internet on the move at data speeds of
up to 144 kbps from their laptops or any other mobile computing device. Connecting an Reliance
Netconnect cable to their Reliance Mobile phone or by using an Reliance Netconnect card inserted
into the PCMAI slot of their laptop, subscribers can be online anytime anywhere. Similarly,
subscribers can connect to the Internet by plugging an Reliance Netconnect cable to Reliance
IndiaPhones, fixed wireless terminals and phones.

Wireline
Wired to win
The successful rolling out of real broadband services across the nation marks the second chapter of
Reliance Communications commitment to usher in a digital revolution in India. Reliance
Communications is setting new standards for the world to follow through inventive use of cutting-edge
technologies in the field of fibre optics, Ethernet, microwave radios, switching, routing, digital
compression and encoding.
The mass roll out of broadband being carried out by Reliance Communications across the length and
breadth of the country, offering speeds of up to 100 Mbps to millions of users, in itself is a
technological marvel.
The uniqueness of Reliance Communications broadband initiative lies in the fact that our entire
nationwide network is being conceptualised and built from ground zero. Our network is designed to
deliver affordable quality education, drive governance, transform healthcare, enhance efficiency in
business and, finally, generate new job opportunities for millions of unemployed Indians.


Reliance Communications broadband service is set to revolutionise Indian society by removing the
traditional bottlenecks of development including a lack of capital and a weak infrastructure, and help
Broadband Internet Access

Network of networks
Today, an executive sitting at home can prepare a strategic plan for a company based in another
country, on a server situated in a third country, that is remotely maintained by IT specialists. None of
this could have been done cost-effectively, were it not for broadband Internet the medium of the
future for work, communication, entertainment and knowledge.
In a world of increasing competitiveness and globalisation, organisations and individuals are
increasingly finding that they cannot function without the Internet and Internet-based applications.
Broadband Internet use in the United States has zoomed from 6 per cent in 2000 to around 40 per
cent in 2005, as a result of new ways of working from home, collaboration and information sharing in
most industries.
India, at the very centre of the outsourcing revolution, is also poised on the brink of a huge broadband
boom. In India, Reliance Communications offers the best-in-class broadband Internet solutions, based
on its robust, cutting-edge global network. .


Growth Unlimited :
Our service is highly scalable, allowing bandwidths from 64 kbps to 100 Mbps without making any
change in the last mile copper. For enterprise customers, we also offer the option of Metro Ethernet
as the last mile port, substantially decreasing the capex cost of high bandwidth circuits.
An integrated telecom service provider :
Reliance is India's most integrated Telecom service provider. It owns the entire end-to-end
architecture, including access systems, the national fibre-optic backbone, the international cable
systems, Internet gateways, and nearly 40,000 sq ft of data centre space.
We provide a single, unified interface that brings you the complete spectrum of esolutions, including
broadband Internet bandwidth, domain registration, mailing solutions and data centre services .




Acceptable User Policy
Rural Communication

Empowering Indian villages
Reliance Communications is committed to bringing about a complete revolution in rural telephony.
With this goal set high on our agenda, we have initiated a mammoth expansion plan to reach out to
four lakh villages across the length and breadth of the country. Our 80,000 kilometres of terabit optic
fibre cable network forms the backbone of our nationwide expansion, facilitating unlimited and
uninterrupted voice, data and video applications.
This gigantic operation is targeted to cover two-thirds of Indian villages and over 5,700 cities and
towns. On completion, it will offer connectivity to 65 crore Indians. This ambitious expansion, involving
8,500 Base Transceiver Stations (BTSs) will cover 91 per cent of our national highways and 85 per
cent of rail routes. Ultimately, Reliance Communications operations will encapsulate the entire
country. This novel initiative will create a tremendous surge in Indias tele-density.
We stand strongly by our commitment to empower the people of India with the freedom to
communicate by realising our founder Chairman Dhirubhai Ambanis dream of heralding a digital
revolution.
Reliance World, our unique infotainment data application, already enjoys 1.5 billion page views a
month. With this roll out, countless more Indians will be able to avail of our services and stay
connected. Rural India will have unlimited access to the Internet through the increasingly popular
Reliance Netconnect. It will surely put India on the fast track to knowledge-led leadership. It is a
recognised fact that each point of increase in tele-density results in a 3 per cent growth in the
countrys GDP.
Village Public Telephone
Reliance Communications Village Public Telephone (VPT) is a pioneering effort to introduce
telephones in villages that do not have any telephone connections till date. These VPTs with STD
facility are being installed in villages for the convenience of the villagers. As per our license obligation
we have installed VPTs covering 59 talukas. We are receiving subsidy support for 3,599 VPTs
everyQuarter from the USOF. .

Rural Community Phone (RCP)
After achieving the target of one village public telephone per village, Reliance Communications next
plan of action is to provide Rural Community Phones (RCPs) in each of those villages where the
population exceeds 2000. These RCPs, with STD facility, are to be installed in public places including
shops, schools and primary health centres. We are fully committed to installing about 22,000 RCPs
covering 61 districts across 11 states in India by 2006.
Rural Household DELs
Reliance Communications' targets to provide Rural Household DELs in those talukas, which have
been declared as rural talukas. Fixed Wireless Phone/Terminal of CDMA technology is being planned
for R Household DELs. We are determined to provide Rural Household DELs in 61 districts covering
203 talukas in India. Our target is to roll out 6,100 of them. .





High Speed Public Tele-Info Centre (HPTICs)
Reliance Communications is committed to setting up High Speed Tele-Info Centres in block
headquarters and villages with a population exceeding 2000. These centres will provide high-tech
facilities including tele-education as well as tele-medicine. These information kiosks will form the
core of the rural broadband connectivity. Our target is to cover one lakh villages in three years which
approximately would cater to 48 per cent of the total rural population.


GROWTH & DEVELOPMENTS



Recent Developments
The company plans to raise Rs 4.5 billion through its maiden ADR or GDR issue., aimed at retail and
institutional investors in J apan....



Brief Financials (in Rs. Mn.)
Period ending (months) 30-J un-2006(6) 31-Dec-2005 (9)
Net sales 850.60 0.00
Other Income 6.40 22.77
Total Income 857.00 22.77
Cost of goods sold 273.10 16.65
OPBDIT 583.90 6.12
PAT 236.20 56.54
Gross Block - 1980.88
Equity capital 6115.70 6116.15
EPS (Rs.) - 0.06
DPS (Rs.) - 0.00
BV (Rs.) - 125.87
P/E range (x) - NA
Debt / Equity (x) - 0.00
Operating margin (% of OI) 68.1 26.9
Net margin (% of OI) 27.6 248.3


Director's Report
The Directors are pleased to present the 31st Annual Report and the audited accounts for the year
ended March 31, 2005.

Financial Results

The performance of the Company for the financial year ended March 31, 2005 is summarised below:

2004-2005

Rs Crs. US$ Mn*

Gross profit before interest, 14,260.84 3,260 depreciation Less : Interest 1,468.66 336 Depreciation
3,784.57 Less : Transfer from General Reserve 61.07 3,723.50 851 Profit before Tax 9,068.68 2,073
Less : Provision for Current Taxation 705.00 161 Provision for Deferred Tax 792.00 181 Profit after
Tax 7,571.68 1,731 Add : Balance in Profit and 5,592.06 1,278 Loss Account Taxation Reserve
Written Back - - Taxation for Earlier Years - - Debenture Redemption Reserve - - written back


Investment Allowance (Utilised) - - Reserve Written Back Amount Available for Appropriation
13,163.74 3,009 Appropriations: General Reserve 3,000.00 686 Proposed dividend on Equity Shares
1,045.13 239 Tax on dividend 146.58 33 Tax on Dividend for earlier years 4.17 1 Balance carried to
Balance Sheet 8,967.86 2,050 13,163.74 3,009



2003-2004

Rs Crs. US$ Mn*

Gross profit before interest, 10,982.88 2,512 depreciation Less : Interest 1,434.72 328 Depreciation
3,331.39 Less : Transfer from General Reserve 84.37 3,247.02 743 Profit before Tax 6,301.14 1,441
Less : Provision for Current Taxation 351.00 80 Provision for Deferred Tax 790.00 181 Profit after Tax
5,160.14 1,180 Add : Balance in Profit and 3,343.06 765 Loss Account Taxation Reserve Written
Back 10.00 2 Taxation for Earlier Years (23.03) (5) Debenture Redemption Reserve 850.00 194
written back Investment Allowance (Utilised) 76.63 18 Reserve Written Back Amount Available for
Appropriation 9,416.80 2,154 Appropriations: General Reserve 3,000.00 686 Proposed dividend on
Equity Shares 733.10 168 Tax on dividend 91.64 21 Tax on Dividend for earlier years - - Balance
carried to Balance Sheet 5,592.06 1,279 9,416.80 2,154

* 1 US $ =Rs 43.745 Exchange Rate as on March 31, 2005 (1 US $ =Rs 43.7175 as on March 31,
2004)

Buy Back

Pursuant to the Buy Back Offer made in accordance with the provisions of the Companies Act, 1956
and the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998, the
Company has bought back 28,69,495 Equity Shares of Rs 10 each of an aggregate face value of Rs
2,86,94,950 as of March 31, 2005. Consequent to the Buy Back, the Paid up Equity Share Capital of
the Company as on March 31, 2005 stood reduced to Rs 1393,50,80,410.

Dividend

The Directors have recommended a dividend of Rs 7.50 per Equity Share (last year Rs 5.25 per
Equity Share) on 139,35,08,041 Equity Shares of Rs 10 each for the financial year ended March 31,
2005, which, if approved at the ensuing Annual General Meeting, will be paid to (i) all those Members
whose names appear in the Register of Members as on May 13, 2005 and (ii) all those whose names
appear on that date as beneficial owners as furnished by National Securities Depository Limited and
Central Depository Services (India) Limited.

The dividend pay out for the year under review has been formulated in accordance with the
Company`s policy of striving to pay stable dividend linked to long term performance, keeping in view
the Company`s need for capital, its growth plans and the intent to finance such plans through internal
accruals to the maximum. Your Directors believe that this would increase shareholder value and
eventually lead to a higher return threshold.

Management`s Discussion and Analysis Report

Management`s Discussion and Analysis Report for the year under review, as stipulated under Clause
49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section
forming part of the Annual Report.

The Company has entered into various contracts in the areas of oil & gas, refining, petrochemicals
and telecommunication businesses. While benefits from such contracts will accrue in the future years,
their progress is periodically monitored.

The Board of Directors, at its meeting held on J une 18, 2005, decided to consider a scheme of
reorganisation of the businesses of the Company and has authorised the Corporate Governance and
Stakeholders` Interface Committee to examine the matter and suggest a proposal to the Board of


Directors for its consideration.

The Board of Directors at its meeting held on J une 28, 2005, decided to execise the option to convert,
162 Crore 10% Cumulative Convertible/Redeemable Preference Shares of Reliance Infocomm
Limited, subscribed at an aggregate value of Rs.8,100 Crore alongwith the accrued premium of Rs.
1,108.27 Crore, into fully paid up equity shares of the face value of Re.1 each of Reliance Infocomm
Limited at a price of Rs.32 per equity share.

Subsidiaries

During the year, Reliance Communications (Canada) Inc. and Reliance Netway Inc. became
subsidiaries of Reliance Communications Inc., a subsidiary of Reliance Infocom Inc., Reliance
Infocom BV as also of the Company. Further, Reliance Communications (Hongkong) Limited became
a subsidiary of Reliance Infocom BV as also of the Company. Subsequently, Reliance Infocom BV
ceased to be subsidiary of the Company and consequently all the subsidiaries of Reliance Infocom
BV, namely Reliance Infocom Inc., Reliance Communications (UK) Limited, Reliance
Communications (Hongkong) Limited, Reliance Communications Inc., Reliance Communication
International Inc., Reliance Communications (Canada) Inc. and Reliance Netway Inc., have ceased to
be subsidiaries of the Company.

During the year, Reliance do Brasil Industrie Comercio de Produtos Texteis, Qufmicos, Petroqufmicos
e Derivados Ltda (Reliance Brazil LLC) became a subsidiary of the Company.

After the close of the financial year 2004-2005, Reliance Industries (Middle East) DMCC became a
subsidiary of the Company.

In terms of approval granted by the Central Government under Section 212(8) of the Companies Act,
1956, copy of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and
Auditors of the subsidiaries have not been attached with the Balance Sheet of the Company. These
documents will be made available upon request by any Member of the Company interested in
obtaining the same. However as directed by the Central Government, the financial data of the
subsidiaries have been furnished under `Details of Subsidiaries` forming part of the Annual Report.
Further, pursuant to Accounting Standard AS-21 issued by the Institute of Chartered Accountants of
India, Consolidated Financial Statements presented by the Company includes financial information of
its subsidiaries. `

Fixed Deposits

The Company has not accepted any fixed deposits during the year.

Directors

The Directors express their profound grief on the sad demise of Shri T.R.U. Pai on J anuary 26, 2005.
Shri Pai was a member of the Board since J uly 6, 1979 and contributed immensely to the Company`s
growth. Your Directors place on record their deep appreciation for the valuable advice and guidance
rendered by him to the Company during his tenure as Director of the Company.

Pursuant to the provisions of Section 262 of the Companies Act, 1956 Prof. Ashok Misra was
appointed as Director in the casual vacancy in the office of Directors on account of the death of Shri
T. R. U. Pai. Prof. Ashok Misra would hold office up to the date of the ensuing Annual General
Meeting. The Company has received a notice in writing from a member proposing the candidature of
Prof. Ashok Misra for the office of Director.

The Directors have reappointed, subject to the approval of members at the ensuing Annual General
Meeting, Shri Hardev Singh Kohli and Shri Hital R. Meswani, both Wholetime Directors designated as
Executive Directors of the Company, for a further period of 5 years from April 1, 2005 and August 4,
2005, respectively.

Shri Anil D.,Ambani, Vice Chairman and Managing Director, has resigned from the Board with effect
from J une 18, 2005. Your Directors place on record their deep appreciation for the invaluable


contribution made by Shri Anil D. Ambani during his tenure as Director of the Company. Shri Anil D.
Ambani has been associated with the Company since 1982 and has played a key role in building
Reliance to its present pre-eminent position in the corporate world. Your Directors convey their best
wishes to Shri Anil D. Ambani.

In terms of Article 155 of the Articles of Association of the Company, Shri H.R. Meswani, Shri R.H.
Ambani and Shri S. Venkitaramanan, retire by rotation and being eligible, offer themselves for re-
appointment at the ensuing Annual General Meeting.

Brief resume of the Directors proposed to be appointed/re-appointed, nature of their expertise in
specific functional areas and names of companies in which they hold directorship and
membership/chairmanship of Board committees, as stipulated under Clause 49 of Listing Agreement
with the Stock Exchanges in India, are provided in the Report on Corporate Governance forming part
of the Annual Report.

Directors` Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to
Directors` Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

(ii) the Directors have selected such accounting policies and applied them consistently and made
judgements and estimates that are reasonable and prudent so as to give a true and fair view of the
state of affairs of the Company as at March 31, 2005 and of the profit of the Company for the year
ended on that date;

(iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of
the Company and for preventing and detecting fraud and other irregularities; and

(iv) the Directors have prepared the annual accounts of the Company on a `going concern` basis.

Consolidated Financial Statements

In accordance with the Accounting Standard AS-21 on Consolidated Financial Statements read with
Accounting Standard AS-23 on Accounting for Investments in Associates,-your Directors provide the
audited Consolidated Financial Statements in the Annual Report.

Auditors and Auditors` Report

M/s. Chaturvedi & Shah, Chartered Accountants, and M/s. Rajendra & Co., Chartered Accountants,
Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General
Meeting and are eligible for re-appointment. Your Directors have also proposed to appoint M/s.
Deloitte Haskins and Sells, Chartered Accountants, as Auditors of the Company, subject to the
approval of Members at the ensuing Annual General Meeting.

The Company has received letters from all of them to the effect that their appointment/re-appointment,
if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and
that they are not disqualified for such appointment/re-appointment within the meaning of Section 226
of the said Act.

The notes on accounts referred to in the Auditors` Report are self-explanatory and therefore do not
call for any further comments.

Cost Auditors

The Central Government had directed an audit of the cost accounts maintained by the Company in
respect of its Textiles, Polyester and Chemicals businesses. The Central Government has approved
the appointments of Shri S.N. Bavadekar, Cost Accountant, for conducting the cost audit for the


Textiles, Polyester and a part of Chemicals businesses and M/s. V.J . Talati & Co., Cost Accountants,
for conducting the cost audit of a part of the Chemicals business for the financial year ended on
March 31, 2005.

international Accountants

The report submitted to the Board of Directors by M/s. Deloitte Haskins and Sells, member firm of
Deloitte Touche Tohmatsu (DTT), appointed as International Accountants of the Company, for the
year under review, is provided in the Annual Report for information of Members.

Secretarial Audit

The Company voluntarily appointed Dr. K.R. Chandratre, Practicing Company Secretary, to conduct
Secretarial Audit of the Company for the financial year 2004-2005. The Secretarial Audit Report
confirms that the Company has complied with all the applicable provisions of the Companies Act,
1956, Listing Agreement with the Stock Exchanges, Securities Contracts (Regulation) Act, 1956, and
all the Regulations of Securities and Exchange Board of India (SEBI) as applicable to the Company,
including the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 and the SEBI
(Prohibition of Insider Trading) Regulations, 1992.

Particulars of Employees

In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975 as amended, the names and other particulars of the
employees are required to be set out in the Annexure to the Directors` Report. However, as per the
provisions of Section 219(1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid
information is being sent to all the Members of the Company and others entitled thereto. Member who
is interested in obtaining such particulars may write to the Company Secretary at the Registered
Office of the Company.

Energy Conservation, Technology Absorption and Foreign Exchange earnings and outgo

The particulars relating to energy conservation, technology absorption, foreign exchange earnings
and outgo, as required to be disclosed under Section 217(1)(e) of the Companies Act, 1956 read with
the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are
provided in the Annexure to this Report.

Transfer of Unclaimed Dividend to IEPF

Pursuant to the provisions of Section 205A(5) of the Companies Act, 1956, the declared dividend
which remained unclaimed for a period of 7 years have been transferred by the Company to the
Investor Education and Protection Fund (IEPF) established by the Central Government pursuant to
Section 205C of the said Act.

Corporate Governance

During the year, your Board has constituted an independent Board Committee, named `Corporate
Governance and Stakeholders` Interface Committee`, to inter alia review the governance systems and
processes followed by the Company, to suggest improvements, if any required in this area, and to
recommend nomination of Directors on the Board.

The Company is committed to maintain the highest standards of Corporate Governance. Your
Directors adhere to the requirements set by the Securities and Exchange Board of India`s (SEBI)
Corporate Governance practices and have implemented all the major stipulations prescribed. Your
Company has also decided to implement several best practices, though not mandatory at present, as
part of good Corporate Governance.

Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the
Stock Exchanges in India forms part of the Annual Report.



Certificate from the Auditors of the Company, M/s. Chaturvedi & Shah, Chartered Accountants and
M/s. Rajendra & Co., Chartered Accountants, confirming compliance of conditions of Corporate
Governance as stipulated under the aforesaid Clause 49, is annexed to this Report.

Acknowledgment

The Directors would like to express their grateful appreciation for the assistance and co-operation
received from the Financial Institutions, Banks, Government Authorities, Customers, Vendors and
Members during the year under review. Your Directors also wish to place on record their deep sense
of appreciation for the committed services of the Executives, Staff and Workers of the Company.

For and on behalf of the Board of Directors

Mukesh D. Ambani Chairman & Managing Director

Mumbai, J une 28, 2005.

Annexure to Directors` Report

Particulars required under the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988.

A. TECHNOLOGY ABSORPTION

Efforts made in technology

absorption-as per Form A given below:

Form A

Form for disclosure of particulars with respect to absorption

1. Research and Development (R&D)

a. Specific areas in which the research and development (R&D) is being carried out

1. Morphologically controlled RELCAT100X developed at lab scale and pilot plant trial.

2. Magnesium alkoxide process developed and pilot plant trial for scale up.

3. Advance donor developed for PP catalyst to be used in homo grades for improvement in catalyst
activity and product properties.

4. Bulk polymerization facility established for regular screening of catalyst.

5. Development of water-proof, all weather colour-fast fabrics for out door/tentage, all terrain,
application.

6. Standardisation of Lycra-plied yarn manufacturing through assembly winding & two-for-one twisting
process.

7. Development of Polyester-Wool-Rayon tri-blends fabrics through standardization of spinning,
weaving & finishing processes.

8. Development & Standardization of bi-functional stain-release as well as stain-repellent eco-friendly
finishes for Childrenwear fabrics fp; J nternationaJ Market.

9. Optimization of wool dyeing process by re-engineering sliver loading device to minimize wool-felting
& waste.



10. Development of high abrasive-resistance woven jacquards specialty fabrics for uniform
application.

b. Benefits derived as a result of R&D efforts

1. In-house development of PP catalyst system for performance & product characteristic
improvement.

2. All weather tentage fabric shall create major opportunities as it intends to replace cotton cloth,
which is not meeting with the finish requirement of the indented customer segment.

3. Standardisation of Lycra-plied yarn has resulted in improved finishing leading to better appearance
of cloth.

4. Developed tropical and tri-blend Polyester-Wool-Rayon fabrics as a new product to create fresh
demand and increased business.

5. Produced Power Teflon double defence mechanism blended fabrics against stains for childrenwear
application.

6. Optimized wool dyeing techniques to minimize felting, reduce waste and-improved yields besides
better finishing.

7. Developed high abrasion-resistance blended jacquard fabrics for apparel end use.

b. Future plan of action

1. Development of high performance catalyst for PP product/on.

2. Development of process for catalyst support.

3. Development of advanced donor and nucleating agents for polyolefin.

4. Technology development and commercialization of Titanium Dioxide product.

5. Development of tri-blend fabrics with Spandex Polyurethane filament yarn along with stain-repellent
finishes.

6. Standardization of processing and finishing process of Polyester- Rayon blend fabrics using special
scouring techniques.

7. Development of anti-felting and dimensionally stable wool & wool-blended fabrics by re-engineering
yarn manufacturing & special finish application.

8. Development of specialty shirting fabrics using power stretch yarns for leisure & comfort.

9. Development of elastic fabrics along with water repellent . properties using various stretches yarns
for medical application.

10.Development & optimization of Polyester-Wool-Rayon-Silk blended fabrics for up-market.

c. Expenditure on R & D

Rs. Crore

a) Capital 21.06 b) Recurring 40.26 Total 61.32 c) Total R & D expenditure as a percentage of total
turnover 0.08

2. Technology Absorption, Adoption and Innovation



a. Efforts made towards technology absorption, adoption and innovation:

Imported technologies have been successfully absorbed resulting in high production level in
operations. New product developments were also done to meet customer demand Technology
innovations have been successfully implemented to increase production and reduce consumption of
raw materials, catalysts, chemicals and utilities. Some such innovations are as under:

1. Cracked Gas Compressor stand alone cooling water system commissioned to reduce cooling water
supply temperature by 2 deg C to CGC intercoolers thereby increasing ethylene production.

2. Expander-compressor unloading scheme commissioned in cracker plant to increase ethylene
production.

3. Azeo-drying time reduced in Hiboil Column and VCM column in VCM plant.

4. EDC Cracking Furnace run-length improved in VCM plant by improving furnace feed EDC quality.

5. VCM Plant debottlenecking done for increase in plant capacity.

6. Use of high Selectivity EO catalyst and new design of EO reactor in MEG-1 plant instead of high
activity catalyst for reduction of raw material consumption and CO2 generation.

7. Catacarb Technology in CO2 removal system introduced to increase the CO2 absorption efficiency
and reduce CO2 concentration at the inlet of EO reactor to improve catalyst selectivity & run length.

8. Glycol section debottlenecking was done in-house. Capacity increased from 315 TPD to 350 TPD
EOE.

9. New polyelectrolyte was developed for improved settleability of effluent water in ETP.

10. Recycling of PET flakes commissioned in PSF CP 8 unit for reduction of oligomer consumption.

b. Benefits Derived as a result of the above efforts

I. Product development/improvement and cost reduction

Capacity enhancement/new grade development/improvement and cost reduction has resulted in
benefits of approximately Rs 75 crores per annum.

II. Import substitution

* Scheme for recovery of Cyclohexane was developed in-house and implemented to recover the
cyclohexane from RB column bottom grease. Resulted in cyclohexane recovery of 1093 MT/annum &
in turn reduction in import of cyclohexane by 1000 MTA yielding saving of Rs 3.4 crore per annum.

* Commercial production of PDEB started using in-house developed catalyst & process technology
(by IPCL R&D and RIL Hz team) resulted in reduction in import by 700 MTA. Bottom line increase: Rs
4.5 crore per annum.

c. Information regarding Imported Technology

Product Technology from Year of Status of implementation/ Import absorption

Polyester Staple Dupont (U.S.A)/ 1998 Full Fibre Fill Chemtex U.S.A.

Paraxylene UOP Inter America Inc. 1999 Full U.S.A.

Polypropylene Union Carbide U.K. 1999 Full

C. FOREIGN EXCHANGE EARNINGS AND OUTGO



1. Activities relating to export, initiatives to increase exports, Developments of New export markets for
Products and Services and Export Plan.

The Company has continued to maintain focus and avail of export opportunities based on economic
considerations. During the year the Company has exports (FOB value) worth Rs 23,741.33 crore
(US$ 5427.21 million).

2. Total Foreign Exchange used and earned

Rs. Crore

a. Total Foreign Exchange earned 23,745.46

b. Total savings in Foreign Exchange 41,520.25 through products manufactured by the Company and
deemed exports (US$ 9,491 million)

Sub total (a+b) 65,265.71

c. Total Foreign Exchange used 43,703.55


Sensex at new peak












MUMBAI: Reliance Communication Ventures Ltd's big bang debut on the bourses on Monday virtually
created ripples among the investor community and sent the benchmark Sensex to yet another intra-
day peak of 10,742.31, even as institutional investors remained upbeat about the budget as also
robust economic growth.
The Rs. 10 paid-up share of RCVL opened at Rs. 290 and later fluctuated between Rs. 309 and Rs.
277.15 before closing at Rs. 290.85 on the first day of its listing.


Driven by high liquidity, the BSE benchmark 30-share Index soared to an all-time intra-trade high of
10,742.31 and even ended the day at a new closing peak of 10,735.36 against Friday's close of
10,595.43, netting a hefty rise of 139.93 points or 1.32 per cent.
In the extended trading session till 4:15 P.M., foreign institutional investors and domestic mutual funds
went on a fresh buying spree after pumping in more than Rs. 1,807 crore and Rs. 616.60 crore
respectively in the first four days of last week.
Remarkable gains in heavyweights such as RIL, Infosys Tech, HDFC, NTPC, BHEL, Tata Motors,
Tata Steels, TCS Ltd, Hindalco, ITC, ICICI Bank, ONGC and Ranbaxy contributed immensely to the
sensex's sharp rally. PTI


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ACKNOWLEDGEMENT
It is our privilege to acknowledge with a deep sense of
gratitude to Prof. Anuradha Satheesan for his valuable
guidance and assigning to us such knowledge based project
defining the importance of Communication Industry.

We are also thankful to Mr. Rakesh J . Khandelwal (Manager.
Swastik Telecom, Dombivli, W.) For their co-ordiation.